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BT.A Bt Group Plc

134.40
-2.25 (-1.65%)
07 Dec 2023 - Closed
Delayed by 15 minutes
Share Name Share Symbol Market Type Share ISIN Share Description
Bt Group Plc LSE:BT.A London Ordinary Share GB0030913577 ORD 5P
  Price Change % Change Share Price Shares Traded Last Trade
  -2.25 -1.65% 134.40 40,295,574 16:35:06
Bid Price Offer Price High Price Low Price Open Price
134.95 135.05 137.30 132.15 136.60
Industry Sector Turnover Profit EPS - Basic PE Ratio Market Cap
Phone Comm Ex Radiotelephone 20.92B 1.91B 0.1916 7.05 13.42B
Last Trade Time Trade Type Trade Size Trade Price Currency
18:57:05 O 1,889 134.40 GBX
Related Shares
Telecom Plus (TEP)

Bt (BT.A) Latest News (1)

Bt (BT.A) Discussions and Chat

Bt Forums and Chat

Date Time Title Posts
07/12/202323:39BT - Where next ?45,155
03/10/202315:1980p is fair value16
02/10/202315:57BT Group826
13/9/202209:16Ј1.20 here we come53
07/6/202211:58 BOYCOTT BT AND SWITCH TO ANOTHER TELECOM...DO A MARCONI ON THEM!28

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Bt (BT.A) Most Recent Trades

Trade Time Trade Price Trade Size Trade Value Trade Type
2023-12-07 18:57:24134.401,8892,538.82O
2023-12-07 18:56:23134.40199,700268,396.80O
2023-12-07 18:36:45133.60233,828312,403.56O
2023-12-07 18:31:46134.37114,169153,412.31O
2023-12-07 18:31:46134.3741,28055,469.17O

Bt (BT.A) Top Chat Posts

Top Posts
Posted at 07/12/2023 08:20 by Bt Daily Update
Bt Group Plc is listed in the Phone Comm Ex Radiotelephone sector of the London Stock Exchange with ticker BT.A. The last closing price for Bt was 136.65p.
Bt currently has 9,943,309,483 shares in issue. The market capitalisation of Bt is £13,423,467,802.
Bt has a price to earnings ratio (PE ratio) of 7.05.
This morning BT.A shares opened at 136.60p
Posted at 04/12/2023 17:28 by rathkum
BT Group PLC's (LSE:BT.A) share price could more than double, according to JPMorgan, which thinks 2024 could be a “break-outR21; year for European telcos.

The investment bank’s bullish sector stance is based on price increases which imply upside risk to consensus, EBITDA growth, free cash flow increases, “best-in-class" EPS growth, falling interest rates and prospects for further consolidation in the sector.
Posted at 23/11/2023 20:59 by isis
Goldmans upped their target and added 'Conviction Buy' whilst UBS who've never been a fan see's value at BT at 115p!! lol


UBS said the shares face several risks/overhangs", listing them as Virgin Media O2 "possibly revisiting M&A discussions with TalkTalk", Sky shifting some of its wholesale broadband business away from Openreach, new CEO Allison Kirkby potentially accelerating the existing strategy with the result of a dividend cut, the 24.5% stake by Altice "may now be more of an overhang than an element of support", and finally that the Labour Party is "reportedly looking to remove mid-contract price rises for consumers and indexation at Openreach".

The Swiss bank reiterated its 'sell' rating and 115p share price target.

Over at Goldman Sachs, the telecoms team have taken a much brighter view, hiking their target price to 290p from 280p.
Posted at 02/11/2023 22:09 by smurfy2001
Philip Jansen got the strategy right at BT. Shame about the share price
Posted at 23/9/2023 14:36 by rathkum
BT Group: Shares Back In The Doldrums But Remain Cheap
Sep. 23, 2023 3:28 AM ETBT Group plc (BTGOF)
Mark Dockray
Summary

BT shares have turned sharply lower since around April. No stranger to disappointment, in this case there is little to grumble about operationally.

Concerns around the pension deficit may be a factor, given its size and exposure to assets like equities and property.

These shares once again trade at a deep discount to my estimate of fair value, albeit with a fair amount of uncertainty embedded in them.

BT Group (OTCPK:BTGOF) is nothing if not frustrating. Shares of the British telco have technically done just fine since my previous update in Q4 2022, returning around 13.5% in local currency and 11.5% for the ADRs, but performance to date still rankles a little given the stock was up over 40% as recently as April.

Chart
Data by YCharts

This company doesn't exactly have good form when it comes to not disappointing the market, but in this case I do think concerns are unrelated to what is happening at the business level. Indeed, I'd say that operationally the company is doing just fine. Growth is never going to blow the doors off of course, but a combination of low-single-digit revenue growth and operating leverage means that profits are up nicely at the moment. CapEx also appears to be by-and-large in line with expectations - one of my previous concerns given recent high inflation and the current large investment program.

My guess is that the pension scheme is what is weighing on the share price. That top-up payments to plug the deficit are a drag on free cash flow isn't anything new, but with the size of BT's pension scheme vast compared to its current market-cap I do wonder whether there is concern that the company might be on the hook for higher payments down the line.
All Looks Okay Operationally

BT's customer facing units are pulling in different directions. Like most of its peers, the segment that houses business customers (~20% of group EBITDA) is grappling with declines in legacy products like fixed voice. On the flip side, Consumer (~32% of EBITDA) is showing modest growth as broadband and cell phone contract renewals are linked to inflation. Openreach (~48% of EBITDA), which manages the UK's largest fixed-line network, is also putting in nice growth, likewise benefitting from inflation-linked pricing as well as the ongoing rollout of fiber-to-the-premises ("FTTP") broadband (which attracts higher revenue per user).

Most recent financial results are a little out of date now given we are near the end of the company's fiscal Q2, but Q1 was solid enough and was not the driver of its share price decline. Inflation-linked pricing mentioned above means that revenue and earnings growth are currently a little ahead of my long-term yardstick, with group FY23/24 Q1 sales up around 4% YoY and EBITDA up a shade more at 5%. Expected declines in Business (-11% YoY EBITDA) were more than offset by higher-margin Openreach (+12% YoY EBITDA) as well as Consumer (+6% YoY EBITDA). The full-year outlook - which sees growth in both revenue and EBITDA - was affirmed.
Little Change On Cashflow Forecast

One thing that had posed a slight concern to me was the impact of inflation on CapEx. BT's ongoing rollout of FTTP and 5G has seen CapEx rise to around 25% of revenue versus around 12% in the mid-2010s, and with higher inflation comes the risk that CapEx budgets end up heading unexpectedly higher still. That would mean even more of a squeeze on the company's already meagre free cash flow.

BT Group plc: CapEx To Revenue (FY15/16 - FY22/23)

BT Group CapEx To Revenue (FY16 - FY23)

Data Source: BT Group plc Annual Reports

Last year's CapEx spending landed broadly in line with prior guidance at circa £5B, and I reiterate that all the FY24 outlook metrics have been reconfirmed. That includes reported CapEx of £5B to £5.1B, with that seen steady out to the FY26 investment program peak.

BT Group plc FY30/31 Free Cash Flow Targer

Source: BT Group plc FY22/23 Annual Results Presentation

BT's longer-term free cash flow forecast remains unchanged, with base FCF (i.e. ignoring any contribution from growth) set to double from FY22 levels to around £3B by the end of the decade. Most of that (~66%) is from normalizing CapEx; the rest will follow from the associated lower costs (e.g. less maintenance) required to run a FTTP network versus the legacy copper one. This is all low hanging fruit for the company and I don't really see any risks in achieving this.
Pension Scheme Concerns To Blame?

Normalized free cash flow was £1.3B last year and is expected to be £1B this year at the low end. Taken at face value that all looks fine and dandy - enough to cover the dividend outlay (~£750m) with some change to spare.

The elephant in the room is the pension deficit. The situation is well-known to followers of the company and indeed it has been mentioned in most of my prior articles on the stock, but for the benefit of new readers, the short version is that BT has to support a huge pension scheme relative to the size of its actual business.

Top-up payments to address its pension deficit are substantial, coming in at a circa £1B cash outflow item last year and only expected to moderate to around £600m per annum from 2024 out to 2030. Subtracting this from the above free cash flow numbers leave us with relatively little actual near-term surplus cash.

BT Pension Scheme Asset Breakdown

Source: BT Pension Scheme Fact Sheet

Now, most of the scheme's assets are obviously in investment grade credit including government bonds. However, a not insignificant amount is in equities, property and other growth assets. My guess is that the market is worried that BT might end up on the hook for higher payments into the scheme should those asset values fall. Property, for example, is experiencing a fair bit of a pain right now due to the higher interest rate environment.
Shares Still Look Cheap

BT shares trade for 120 pence apiece at time of writing. As it stands, my DCF-derived fair value estimate from last time remains largely unchanged. That is based on consensus estimates for FY24-FY26 normalized free cash flow, plus management's longer-term forecasts (as show in the "Little Change On Cashflow Forecast" segment above), all discounted to the present at an annual rate of 9%. Subtracting net debt gets me to around £21B in equity value, or 210 pence per share (~$2.55 per ADR at the current GBP/USD exchange rate).

The wildcard is the pension scheme. Suffice to say that increased payments to plug the deficit would materially lower medium-term free cash flow and alter any DCF model substantially. Even so, an implied 80% discount to fair value already incorporates lower free cash flow to a large extent, and so I do think this is a risk worth taking. Strong Buy.

Editor's Note: This article discusses one or more securities that do not trade on a major U.S. exchange. Please be aware of the risks associated with these stocks.

This article was written by
Mark Dockray profile picture
Mark Dockray
1.04K Followers
I like to take a long term, buy-and-hold approach to investing, with a bias toward stocks that can sustainably post high quality earnings. Mostly found in the dividend and income section. Blog about various US/Canadian stocks at 'The Compound Investor', and predominantly UK names on 'The UK Income Investor'.
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Posted at 28/7/2023 22:08 by pj84
BT - price rises give performance a boost

Matt Britzman | 27 July 2023 | A A A
No recommendation
No news or research item is a personal recommendation to deal. All investments can fall as well as rise in value so you could get back less than you invest.

BT Group plc Ordinary 5p
Sell: 124.20 | Buy: 124.30 | Change 0.25 (0.20%)
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BT reported first-quarter underlying revenue of £5.2bn, a rise of 4%. Openreach was the standout, where higher prices and a growing fibre footprint helped deliver 8% growth.

Openreach is now 44% of the way through its full fibre build, expanding to 11m premises. First-quarter fibre orders were up 34%, but the overall broadband base was down as the shift away from copper lines continues.

Underlying cash profit (EBITDA) was up 5% to £2.0bn as higher revenue and cost controls were able to more than offset cost inflation.

Full year remains intact, which looks for growth in revenue and cash profit, as well as underlying free cash flow of £1.0-£1.2bn.

The shares fell 1.9% in early trading.

VIEW THE LATEST BT SHARE PRICE AND HOW TO DEAL

Our view
First quarter trading benefited from recent price hikes, and it was pleasing to see full year guidance was reiterated, pointing to growth in the top and bottom line. Management hasn't put any figures on that, but consensus is looking for a little over 1% on both, so nothing to shoot the lights out.

Cost cuts were in focus back at full-year results, led by the news that the workforce is planned to drop by up to 42% by 2030. Job cuts are hardly surprising, but the plans' scale surprised markets and pointed to many of the issues BT's been facing.

Costs have been a bugbear, and the £2.1bn in savings already delivered has undoubtedly helped. But once the fibre and 5G infrastructure is built and adopted, a much leaner operation is needed to generate long-term growth.

The wider strategy involves significantly modernising and simplifying operations and product line. This includes digitising customer journeys and moving customers onto the new 5G and fibre broadband networks, which have lower running costs than legacy infrastructure.

The real workhorse for this is the group's infrastructure arm, Openreach, which is responsible for maintaining and building out the new fibre networks. It hopes to reach 25m premises by 2026 and spending's set to ramp up even further as BT looks to take advantage of government tax breaks. This technical-heavy business is unique and higher margin, and an asset to the business.

However, substantial improvements aren't free. Constant investment is one of the realities of the telecoms business, as infrastructure needs to be maintained and upgraded. We worry that despite the progress and the goal of reducing spend once infrastructure's in place, BT will have to keep shelling out to keep itself on the cutting edge. It doesn't help that telecoms is an inherently difficult sector to try and deliver attractive margins. Both regulators and customers will always want more for less.

Another drain on cash is BT's large pension deficit. The current payment plan cost just shy of £1bn last year, and we're expecting details on the latest review shortly. There's the potential for a write-down on the some of the assets, increasing the deficit. That won't necessarily mean higher payments, but at the very least it'll extend their duration. Add to that the debt pile, especially in the current higher-interest rate, and the demands on cash are considerable.

BT has its attractions. Its mobile networks are broad and generally high quality, while Openreach is unique and higher margin. But it needs to leverage all of its advantages if it's to satisfy the never-ending investment demands and return to sustained dividend growth.

BT key facts
Forward price/earnings ratio (next 12 months): 6.9
Ten year average forward price/earnings ratio: 10.0
Prospective dividend yield (next 12 months): 5.9%
Ten year average prospective dividend yield: 5.0%
Posted at 26/7/2023 06:13 by nige co
I don't believe that Drahi, a billionaire would invest billions in a company that he wasn't sure of the outcome. He's not here to lose money. He hasn't become a billionaire by being foolish. So that leads me to think that he will be a winner in the end, he's playing the long game, he's got something lined up, that he must be pretty sure of the outcome. Time will tell, hopefully.

Since Drahi started purchasing his BT shareholding, the share price briefly breached £2 in June 2021, I would guess based on his share purchasing, before falling back. He purchased more shares and the share price almost touched £2 again in July 2022, he's since purchased his last lot with no reaction to the share price, now down at a depressed 124p. How many more times can the BT tree be shaken of weak investors. Is managements hand weaker now that Jansen is resigning in regards defending a bid. I think so. Is Drahi building his stake to do a deal with DT, who have said previously that they could make a deal with BT.

All things considered, is it now or never for a takeover bid?
Posted at 12/7/2023 09:30 by nige co
Just waiting on a big intraday spike in the BT share price on news that DT have increased their BT stake. Now that would surly move the undervalued share price.
Posted at 25/5/2023 11:55 by nige co
What's the chances that Drahi is acting on behalf of DT, Drahi buys shares, he denies that he's going to make a bid, this helps keep a lid on the share price. If DT were to increase their BT 12% holding the share price would react. That's just one possibility.
Posted at 19/5/2023 07:44 by spacecake
"Very light volume, prices look odd."

What should they look like ?

The thing is for me with this kind of thinking is that it will not change anything, the market goes nuts over anything and nothing. Looking at share prices and trying to apply logic will put anyone trying into a hospital. I'm sure the board don't follow the share price or care about it otherwise it would better than it is.
Posted at 18/9/2022 09:37 by waldron
FWIW

Is now finally the time to load up on BT shares?

Despite their poor performance, this Fool thinks BT shares would be a strong addition to his portfolio. Here, he explains why.

Charlie Keough
THE MOTELY FOOL


Published 18 September, 9:00 am BST



The trajectory of BT (LSE: BT-A) shares will no doubt have been leaving investors feeling gloomy in recent times.

The telecommunications giant is a FTSE 100 stalwart. And while it’s failed to excite for a while, I think its current price could be appealing.

Here’s why.


BT share price history

Let’s start by assessing the performance of the stock.




Looking at the BT share price across the last five years isn’t pretty reading. Since then, its share price is down over 50%. The stock flirted with the 300p mark back then. Today, a share costs just 140p.

The last year has told a similar tale. In this time, it’s down 9%. And these losses have only continued in 2022.

The main reason for this is inflation. Rates going higher have seen investor confidence in the market go lower. While BT isn’t alone in its struggles as this year has seen a monumental amount wiped off global markets, it’s still not good news for shareholders.

On top of this, the business has also been in the news following staff strikes. The firm had been embroiled in discussions with the Communication Workers Union regarding calls for a pay rise amid the cost-of-living crisis. But BT’s offers haven’t satisfied the union.


Not all down and out

It’s clear to see BT has faced headwinds. However, I see potential with the stock.

Firstly, its dividend yield will most certainly come in handy during these times. For the year ended March 2022, its payout totalled 7.7p per share. At current levels, that equates to a 5.5% yield. And while it’s not inflation-beating, it offers me a greater hedge against inflation than the FTSE 100 average.

Another enticing factor is a potential takeover by French billionaire Patrick Drahi. He currently owns an 18% stake in the firm. And with the UK government providing Drahi an unexpected all-clear regarding his stake, this could open the door for a takeover attempt in the months ahead. This would provide the BT share price with a boost.

Of course, I don’t buy solely based on speculative factors such as a takeover that may or may not happen. You see, I also think there’s long-term value in the stock.

What I like about BT is the large infrastructure it already has in place. This provides it with some higher degree of pricing power. This was seen with raised prices for broadband and mobile contracts boosting its sales in the last quarter. With the continuous expansion of its Openreach network, which now reaches 8m homes and businesses across the UK, I think BT has solid foundations to excel.

My biggest concern is its debt. As of 30 June, its net debt stood at £18.9bn, which is a monumental sum. With interest rates rising, and with further hikes expected, this will make the debt harder to eradicate.


Is now the time?

So, is now a good time to load up on some shares?

I’d say yes. It’s been a tough year for BT. And I’d expect it to face further headwinds. While I have no spare cash right now, if I did I’d open a small position in the stock today. Its large infrastructure provides it with an edge. And its dividend yield and a potential takeover are also a draw.
Bt share price data is direct from the London Stock Exchange

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